Ron Paul: No Taxpayer Bailouts or Liability Caps for BP!

Sadly, the disaster in the Gulf continues this week as BP’s efforts at containment keep hitting snags and residents along the coast scramble to clean up and defend their shores and wildlife. Many have criticized the federal government in the past weeks for not doing enough. The reality is there is only so much government can do to help, yet a lot they can do to prolong the problem and misdirect the pain. For example, in the interest of “doing something” the administration has enacted a unilateral ban on offshore drilling. This is counterproductive. I am proud to cosponsor legislation to lift that ban. Why punish other oil companies and their hard-working employees who had nothing to do with this disaster, and who have better safety records?

And, as usually happens after disasters, countless people – even officials in local and state government – have come forward who know what needs to be done and are willing to help, but have been stymied by federal bureaucratic red tape as the oil continues to gush. The real problem is not so much a lack of government assistance, but government getting in the way of those who have solutions. We witnessed the same phenomenon during hurricanes Katrina and Ike. It seems government’s main role in these situations is to find excuses to stall relief, hold meetings and press conferences, waste money, punish the wrong people, and over-regulate.

Yet even after many examples of past incompetence, people still look to government to solve problems in the wake of disasters. A government that tries to be all things to all people might engender a lot of learned dependence, but ultimately it only harms the very people it is supposed to serve as they wait helplessly for salvation from Washington.

Government could help by holding the appropriate parties fully liable for damages and clean-up costs. I am hopeful that efforts to do this are genuine and BP is indeed held responsible for all damages, not shielded by liability caps or reimbursed under the table by taxpayers. Unfortunately, a large sum of taxpayer money has been slipped into the upcoming supplemental bill for Gulf cleanup costs that should fall on BP. Taxpayers should not have to bail out a major oil company that has caused this horrible damage to our shores.

It should be noted that BP is not exactly a bastion of free market capitalism. Rather, they are very vested in acquiring government subsidies, favorably slanted policies, and competition-hobbling regulation. BP has even been a major lobbying proponent of cap-and-trade because of certain provisions in the legislation it could profit from. Considering who lobbies for them and what they lobby for, my concern is that attempts to hold them strictly and fully accountable could end up being nothing more than a shell game, with taxpayers ultimately holding the bag.

If the government’s idea of action in crisis is to punish the innocent, bail out the guilty, and raise prices at the pump on everybody, we should want them to do less, not more. Recent polls show sharply waning support for offshore drilling. We still need oil, and a lot of good jobs depend on oil production. It is crucial to the functioning of our economy. But if accidents continue to be handled this way, it is easy to understand why so many see more cost than benefit to off-shore drilling, and that is also a tragedy.

Regardless of which company is handling a drilling project, deep water oil drilling carries an inherent risk. Should that risk materialise, investors have now seen a political willingness to use rhetoric to rescue political kudos coupled with arm twisting to seize assets. What oil company would be daft enough to invest in future exploration in the gulf, if the price of a mistake is to have your company and its shareholders effectively raped? For an oil-guzzling nation like the US, the future price in terms of energy security could be huge if, even as they encourage companies to undertake deep-water drilling in order to benefit from the oil tax revenues, jobs and energy security, they refuse to accept the reality of the associated risk, instead dumping its entirety on the shoulders of shareholders.

If politicians gets the balance wrong between the public emoting demanded of them, and pragmatic realism, BP could end up fatally damaged by a combination of politically motivated revenge and a capricious legal system (and a public) that demands punitive damages. If this happens, the global oil industry will undoubtedly capitulate any further investment in an oil-rich gulf and oil prices could spike to ridiculous, job destroying, levels.

I guess I'm saying it's right that BP have already (voluntarily) relinquished their rights to limit their liabilities under the existing law, but there are dangers inherent in allowing the 'mob' to set policy. Those dangers are compounded when politicians play to a populist gallery.

Most people do not understand the fact that this IS the governments fault. What the hell is/was the MMS doing handing out permits to this company? The government FAILS at everything that it does. The problem is that oil companies along with banks and insurance companies, own the government. It is time for the people to rise up.

Like I said before BP was one of the companies that donated their money for the Obama campaign. & Obama will say that "we must bail out them before it's the end of the world." Just more lies from the federal government pretending to be concern! & Government is ineffective anyway.

Turns out now that BP and MMS have been battling this since Feburary and both took the risk and did NOT shut it down. They are both at fault. Saw it on Bloomburg, FOX and Hot Air.
Of course the dems in the house grilling Tony H of BP is just the gov't attempting to cover their own asses. Both are now working together to do just that as they both look and are inept.

BP was way out of line & a complete failure. We don't need more gov't b/c of red tape. We need other private citizens to watch BP. People in LA knew what they needed to clean up & couldn't get it b/c of red tape. You'll never prevent all accidents, u can't control everything...at least not if you want a FREE society!

Remember that Corporations have been declared as people. The idea that the Government should take ownership of BP is EXACTLY the same as holding a MAN or Woman Slave because they owe money, or have committed a crime. Please do not consider things from a view that the President has dictatorial power this is a dangerous mind set. The Courts where made to handle such issues. Common Law would say that IF any Person, or their Property is damaged then the responsible party should compensate

Did you look at that video I sent you? It contains the structural logic for a free market in environmentalism as you and I might advocate for the majority of all other property and why gov't fundamentally can't protect anything (and I mean anything) as well as the private sector.

With respect, you don't exactly lend yourself to charitable interpretation, particularly if you don't distinguish profit by lobbying the gov't at the expense of the consumer and profit done voluntarily.

Does the U.S. Federal gov't lead your investigation? If so, count on the part where they were an accomplice in the crime to be left unwritten.

Disclaimer

RonPaul.com is maintained by independent grassroots supporters of Ron Paul. Neither this website nor the articles, posts, videos or photos appearing on it are paid for, approved, endorsed or reviewed by Ron Paul or his staff.